diaper dash in ft. wayne, indiana. i'm chris wallace two big states up for the tuesday. the next big race for republican president. >> chris: mitt romney fights for his political life in home turf as well as arizona. we'll hear from the candidate trying to regain his status as the front-runner. then one of the country's leading governors with an unmatched fiscal record. how would the man from indiana put america back to work? we'll ask republican governor mitch daniels. plus, we have pain at the pump become pain at the polls for president obama. we'll ask our panel how rising gas prices will affect the

presidential race. and our power player of the week offering adventure on the internet, all right now on fox news sunday. >> chris: hello again from fox news in washington. on tuesday, voters go to the polls in michigan and arizona to what maybe the most important primary day so far. joining us now from flint, michigan is governor mitt romney who has a lot riding on both. welcome back to fox news sunday. >> thanks, chris. good to be with you again. >> chris: before we get into politics. i want to ask about the latest crisis in afghanistan. as you know, nato forces are being pulled out of all the afghan ministries there because two top u.s. advisors were killed as part of a continuing furor over the burning of the qurans. the question i have, what does it say to you. pulling our forces out of the

ministry, what does it say ten years after the war begin on the nature of the alliance with the afghans? >> it's an extraordinary mission of failure for us to establish the relationships that you would have to have for a successful transition to afghan military and afghan security leadership. i hope that we're going to see some improvement very soon. it's obviously very dangerous there. the transition effort is not going as well as we would like to see it go. certainly, the effort there is an important one. we want to see the afghan security troops finally able to secure their country and bring our troops home. >> chris: do you spill oppose president obama's pulling out troops this year from afghanistan and what do you think of his earlier apology this week for the burning of quran? >> with regards to the apology, for a lot of people, it sticks

in people's throats. idea we're there, having lost thousands of individuals through casualty and death. we've made an enormous contribution to help the people achieve freedom and for us to be apologizing at a time like this is something very difficult for the american people. at the same time, i'm concerned about the pathway forward. i think the president made an enormous error by announcing the withdrawal date of our surge forces during the fighting season. he should have waited for at least three months until things quiet down. second announcement as when the combat forces railroad going to be brawn. one thing to make those make the decisions internally and make an announcement like that. and specific wrought the day before you have the input from those around the field, i think it's another mistake. he has made it more difficult for our fighting men and women

to be successful. >> chris: to make it clear, governor, you are saying despite the killing and in some cases, inside job killing of american soldiers, you would continue your commitment to winning the war in afghanistan? >> what we want to do is transition afghanistan to its own military and own security forces can main sane the sovereignty of their government from the taliban. they don't want them to return to a taliban dominated nation with al-qaeda coming into the nation. that is a mission which is continuing and based positive upon what we're seeing so far, we haven't been as successful as we could have been. one of the reasons for that is the president did not assure the elections were fair and open with a credible candidate being selected. the president announced the withdrawal date, a time certain which i think made it clear to the taliban, they tried to wait us out. i think the president has made

enormous errors. >> chris: four years ago you won michigan by nine points over john mccain, but in the latest polls, you are barely beating rick santorum. why are you having such a tough time to lock up your home state against rick santorum? >> i am proud i was born and raised in michigan. last time when i ran against senator mccain, i think i started off at points behind in the polls and was able to fight very hard. about ten days ago, i think rasmussen had me down 15 points. now it's tied or i'm slightly ahead. i can come from behind and if the people focus on my campaign and my candidacy and my plan to get america working again, a plan that calls for dramatic changes in the way that washington is structured, those are things i think people are warming to and i'm making

progress. >> chris: you don't have much more time. the vote tuesday. are you going to win michigan. secondly, even if you do, isn't this nomination battle is going to go on until may? >> i'm planning on winning here in michigan and also arizona. obviously that will be huge for us if we're able to do that particularly having come from so far behind here in michigan. we're planning on winning. momentum is in the right direction. we've cut the lead down. now, we're tied and slightly ahead, some polls show us ahead slightly. we'll see what happens in the remaining days. how long it goes on, it's hard to predict. i'm convinced it will be the nominee. we'll be willing to take however long it takes to get the job done. >> chris: one problem that you have in michigan is that you oppose the government bailout of chrysler and general motors. you say that the companies eventually went through

bankruptcy which which is what you advocated all along. critics say there is a problem with that. let me pointed that out. with government money, the two companies, chrysler and gm went through chapter 11 reorganization which was faster and easier. without government money they would have gone through chapter 7 liquidation which the companies say would have cost thousands of jobs. critics say one of the reason they needed the government money is that private companies refuse to give them any money including your old company bain capital? >> i know the obama people are pushing that story. if we go back in history to 2008 when the ceos of these companies went to washington asking for $50 billion. i said don't give them the money. instead, have them go through a managed bankruptcy and if they need help, after that bankruptcy then the government can help with guarantees and warranties and so forth. the money comes after they have

gone through bankruptcy. what the obama people did, they started writing checks until they realized i was right. they needed to go through managed bankruptcy. when they got it done, they were able to get their legs underneath them. i'm delighted to seat companies back and thriving. and lay out a plan not just to be the motor city of america but the motor city of the world. >> chris: to follow-up on that. there are a number of people, number of top leaders in michigan who say you are wrong. without the money up front, which they couldn't get from private companies, which they had to get from the government they would have gone through chapter 7 liquidation instead of a chapter 11 managed bankruptcy, the governor of michigan who supports you, he says that. so does the head of general motors. >> it would have been a bankruptcy for years. i think you have written off

this company, this industry and this country. >> chris: this say without the government bailout, cries heard general motors might have gone under. >> well, they are not understanding what i wrote and what i believe. there are a lot of businesses that get into real trouble. you see airlines going into bankruptcy and all sorts of businesses. they come out and be able to be stronger. this is not the first time that company has been in trouble. don't start writing checks as they did for months. it was the head of the uaw, they can't go into bankruptcy. don't do that. they'll never come out. he was wrong. i was right. they finally went into bankruptcy. after bankruptcy that was the time to give them the financial support the guarantees to provide them help to get them out of bankruptcy is the way it would have done best. result of the president's plan we spent several billions dollars at a time we didn't need

to. after the process was over, he gave a huge share of the company to uaw, paying off the people that supported him. the right course for this industry to go through the same kind of bankruptcy other industries have. if for some reason they needed government help, tha auto executives that they went to receive in the first place. >> chris: let's talk about your new economic plan that you released this week. would you cut individual marginal tax rates by 20% across the board. no taxes on capital gains and dividends for families making less than $200,000. cut the corporate tax rate and entitlement reform and slowly raise the eligibility age for medicare and social security and smaller increases for the wealthy. there have been criticisms on the right and left.

they say you are playing the obama class war game. santorum says you are using the language of occupy wall street making life more difficult and the rules different for the top 1%. how do you respond to that. >> we have a progressive tax code right now. what i'm talking about is pretty significant reductions in tax across the board. the reason i'm talking about those marginal tax rate reductions is create incentives for small businesses to start hiring again. i'm not trying to say one group is going to get a better deal. i'm trying to make sure under no circumstances is the middle-class going to end up with a larger share of the tax burden. it's essential to me as guiding principle middle income americans don't get hit with the bigger share of the burden. as we add it all up, middle income americans are not getting a bigger burden.

>> chris: what about the argument you are using the same class warfare. you hear it from a lot of people. "wall street journal," it's the same obama class warfare argument. you are going to reduce capital gains for middle-class but not for the rich. >> obviously, i want to make sure we maintain the code and i want to help the people that have been hurt by obama economy, that is middle income americans. i don't want to change the deal with regards to people looking at their share of the tax burden, but what i'm looking to do is lower the marginal rate for all americans across the border board would. -- board. >> 55% work in businesses course think are taxed at the individual rate. i want to get the rates down so we can get american workers back into jobs again. this is pro-growth policy. that is waul why the "wall street journal" liked it.

that is why i think people look at president obama's plan which is calling on raising the marginal rate. that will kill jobs and make it harder for our economy to reboot. whatever choice of language, i want to make sure and get across to the american people, i am cutting rates by 20% and not put a bigger burden on middle income americans. >> chris: argument from the left if the plan as you and your advisors claim is revenue neutral which means that all the taxes and you eliminate from deductions isn't going to raise or lower the deficit, that you get your deficit reduction through spending cuts, $500 billion you claim in 2016. they say that adds up being about 40% cut in domestic programs which means major cuts in the programs of the poor. >> i'm sure you understand, the

tack plan that i've described is very much consistent tax plan with the president's bipartisan commission came up with. it's similar to mine. president obama just abandoned his own tax initiative. >> chris: he took a trillion dollars and used it for deficit reduction, you don't. >> yeah, i take, i get tax rate. take the marginal rate down to encourage economic growth. it will put more people back to work. i also broaden the base which means for certain individuals, high income individuals we're going limit the deductions. then i go through and reduce the rate of growth of benefits for high income people and medicare and social security for folks down the road. then i also eliminate a lot of programs, federal programs and take a lot of poverty programs and send them back to the states

where i think they can managed far more efficiently. if this is an argument about president obama saying, hey, look don't cut back on federal spending, keep on growing the federal deficit. >> i think that is battle i'm going to win. i'm planning on getting a balanced budget and getting this economy going again. this is a classic of two different philosophies. do you believe in lower marginal rates and smaller government. that is what i believe in or do you believe in higher taxes like the president is proposing and more government spending and larger deficits. that is what president obama stands for. >> chris: finally, you are unfavorable to going up dramatically during the course of campaign, back in october you were plus 11 favorable versus unfavorable. now you are minus 8. i hear two major complaints about you. one is you seem to be campaigning more by attacking your rivals than saying what you are for.

the other is this continuing argument that somehow you seem out of touch with the average american. there were two examples i want to play and have you respond to. >> i'm the only person -- >> you have to ask the questions you want. i get to give the answers i want. >> i drive a mustang and chevy pickup truck. ann drives a couple cadillacs. >> do you understand why some voters would be put off by those things? >> i can't be perfect. i just am who i am. with regards to the cars we have that is something that was talked about last september. people asked what vehicles we own. we have a car that we have in california. we have a car back in boston. that is the way it is. if people think there is something wrong is being successful, they better vote for the other guy. i have been extraordinarily successful and i want to use

that know how to help the american people. in terms of connecting with the american people, other people have come and gone. i've got more votes in this race so far. i've been the guy that has been able to connect in new hampshire and in florida and in nevada. i think we're on track to pretty well in michigan and arizona. i'm expected to get the nomination because i understand how the economy works. by virtue of experience i know how to create jobs and i've also balanced budgets. i've done it as a governor, as head of olympics. >> chris: so what is the biggest misconception about you? >> i think the biggest misconception, i'm a guy that comes from massachusetts therefore i can't be conservative. if you look at my record in massachusetts and see that i balanced the budget, lowered taxes 19 times, enforced the illegal immigration laws, got

english in our schools, stood up for traditional marriage, was pro-life governor. i'm a solid conservative with the kind of principles that america needs. >> chris: governor romney, thank you so much for joining us. we see see what happens on tuesday night. >> thanks, chris. >> chris: governor mitch daniels on the republican race and what needs to be done to get america working again. p@?ñm ñoy÷hó

>> chris: the nation's governors are in washington for a national conference. indiana governor mitch daniels. welcome back to fox news sunday.

it seems that this republican race goes on, g.o.p. voters are growing less, not more satisfied with the field. let me put up a couple of statistics a gallup poll finds 55 am if someone else were running, here is what jeb bush this week. it's a little troubling sometimes when people are appealing to people's fears and emotions rather than try to let them look over the horizon for a perspective. >> are you troubled by the negativity some would say the smallness of this race? >> from time to time on both sides, the president one the main perpetrators of negative politics. we can all wish and i do it would subside some. i don't blame the candidates. there is a certain dynamic to the race that leads to making if i any indication of small

differences. >> chris: you have said that republicans need to focus on the economy and debt. as you said once, to call a truce on social issues. are you troubled when you see republicans talking about contraception and planned parenthood? >> they didn't start this. the president did with very intrusive decision. i think when they get a chance, governor romney this week, talking about all the right issues. ultimately that will be where the election be decided. this economy is the weakest recovery ever. fewest number of americans in the work force working today. eventually this is going to be a binary choice. it will be decided i'm confident on the biggest issues.

>> chris: are you impressed by romney's economic plan as he just laid out? >> i'm very encouraged. over candidates, by the way, are talking about the right question. how do get this economy growing and not kill growth as this administration does with every new action and regulation. so, yes, i think things are headed in a direction that will present the american people with a good contrast and a positive alternative. >> chris: couple questions. is it too late for someone new to get into this race and to push it to a contested convention in august? >> you are not asking a right guy. i'm told it's not too late to file with a significant number of delegates as technical matter. as a practical matter i don't think it's likely. i don't know what it would lead to. >> chris: is there any chance,

are there any circumstances under which mitch daniels gets into this race? >> no, sir. i crossed that decision bridge a long time, my family did. i look forward to helping our nominee, but running for president is something i never thought about doing and nothing changed my mind. >> chris: so if drafted you will not run? >> some things don't happen. you have been covering these things a log time. we'll have a nominee well ahead of the convention. a lot of these questions which are intriguing right now will be long forgotten. we'll have a debate how we keep this country from going broke. how we restore the american dream. >> chris: as you know, gas prices are rising sharply. back when barack obama took office, gas cost a 1.895 a

gallon, it's up to $3.87. you blamed what you called extremist policies by the president that spiked domestic production and you said it was a pro poverty policy. this week the president talked about republicans. >> you can bet since it's an election year, they are dusting their three-point plan for $2 gas. i will say, step one is to drill step two is to drill, step three is to keep drilling. >> president says republicans are playing politics with gas prices and lots of it is beyond the control of any president and domestic oil production is the highest in eight years? >> let's give the president credit, one domestic policy. he wanted higher gas prices and he got him. he said it.

secretary said it would. salazar it would go for $10 if they didn't allow drilling. they have gotten doubling of gas prices and perhaps is a conscious policy of this administration. one thing they set out to do and actually accomplished. let's face it. when you lock up vase tracks of land where we know there is oil. when you get shale oil and gas, they got eight agencies regulate it. when you have environmental regulations that are going to raise the price of refining gas and put some of our refineries out of big, guess what? you will get higher gas prices. >> chris: they say they have opened millions of acres, oil and gas exploration and that

u.s. dependence on foreign oil is the lowest in 16 years. >> no thanks to them. this is the product of openings under his predecessorer. he inherent a pro energy policy. seven then, leases have been cut in half, permitting has been cut by two-thirds for new drilling. >> chris: the question of just how strong this economy is. unemployment now down to 8.3%. that is the lowest in three years. new claims for jobless benefits hit a four-year low. consumer confidence is at a one-year high. isn't the economy getting better? >> if the president thinks he is going to be run on economic suction story, she headed for a rude surprise. unemployment rate doesn't tell us anymore.

the employment rate again just fell below 64%. the lowest since the '70s and a lot of moms were staying at home. unemployment insurance claims may be down but we moved a couple million people under the social security disability rule which is new form of permanent unemployment for a lot of people. this is not a pretty picture. we ought not candy coat it. we need a different mix, pro-growth policies. i've said often until americans are working again, until we have the revenue coming in to pay our bills and meets our debt and everything else. >> chris: finally, you just signed this month a law making indiana the 23rd state right to work state in the country which means that people no longer have to join the union to get a specific job. question -- what is wrong with unions? >> nothing is wrong with unions. if that measure affected the

right to bargain, the right to organize collectively, i wouldn't have been for it. all it says is the worker can decide whether or not they would have that money themselves. >> chris: doesn't that neck necessarily over the long run, weaken unions? >> no, not necessarily. there are higher rates of unionization there are in indiana today. it's really whether people think they are getting their money's worth. it's bringing more jobs to the state. already the phone is ringing and we are about to strike some agreements i think for a few more to work. >> chris: back in 2006, you said that you oppose right to work as in your words as too divisive. now as a result of this decision to make a right to work state, that wages will go down and work places will become more dangerous?

>> first of all, that is all bunk. facts couldn't be more clear, that safety is unaffected and wages growth is much faster. for several years, i never said i was opposed to right to work. i said we can succeed under the labor laws we have. ultimately, particularly in this terrible national economy, i reluctantly came to the conclusion we needed to take this step if we were going to have the opportunities. >> chris: governor daniels. a pleasure to talk to you. please come back. >> up next, sunday panel tackles the rise in gas prices and growing violence against persons in afghanistan. back in a moment.

there is no silver bullet that will bring down gas prices or reduce our dependence on foreign oil overnight. >> president says there is no single silver bullet. that is just wrong. defeating obama is a single thing that will change. >> chris: war of words as the president and newt gingrich point fingers for the resent

pain of the pump. bill kristol, evan by and ed gillespie and political analyst juan williams. president made a preemptive speech this week on gas prices. so basically to say he is doing everything he can and republicans were playing politics on this issue. how effective was it? >> it might have helped muddy the waters. gas prices are potentially damaging issue. its price that everyone sees at the pump. i think in voters' minds it correlates things going bad. when gas prices surged in our adult lifetime, in the '70s. a lot went wrong. so i don't think voters don't like to pay 3.74 at the pump but

things won't go well if gas prices are rising so much. >> that is right. people see it every week when they fill up at the pump. as you pointed out,. >> chris: you are a how soon yes, sir. >> we are finally getting our dues. thank you for that. we are a motoring state. people forget, gas prices hit $4 under president bush. it has fluctuated under both parties. they have used it politically. important thing to remember, in the long run, chinese demand, tensions in the middle east you can't do much about it. this president has been aggressive in raising fuel economy standards and diversifying supply petroleum which is only thing a president can do.

>> chris: high gas prices, in this campaign, how effective or persuasive is the obama argument domestic production is the highest in eight years? >> it's very potent issue, people see it every week when they fill up. it agra elevates people and they see a correlation to his policies. keystone and the pipeline he rejected. drilling in the gulf of mexico, down 30%. drilling in federal loses in rocky mountains, down 67%. they stopped drilling off the on coast of virginia. so it is a big problem for them. it's going to be a drag on the economy. >> at the moment. it's monthly a modest impact on the economy. something gets lost here.

even if the united states were to drill, drill more. that domestic oil production is really part of a global oil production story. you have more and more global oil production but it's going to have limited impact in terms of the type of gasoline worldwide because what is going in brazil and china and the threat of middle east stability. even if the u.s. is producing more oil, gas prices are not going down markedly. it's going to be oil is marketed worldwide. >> chris: and i wanted to talk about the afghanistan, the accidental burning of qurans, today it is reported, sunday, seven u.s. special operations forces were wounded when afghan protestors threw grenades into a u.s. base in northern afghanistan. that follows the killing this

week of four u.s. military people including the assassination it appears inside the interior ministry of two military advisors yesterday. as a result all nato personnel are being pulled out of government ministries. i'll ask you, bill, what does it say about the nature of our alliance with afghanistan ten years into this war? >> it says it's not good. it really isn't. i was in afghanistan in october. we went to some of the ministries where there was u.s. advisors and john allen was very proud how much we were doing with the afghans. it's going to be a transition to afghan control. we need to make it work. it makes it incredibly hard. it's really depressed, in the effort to make it more of a success. >> chris: to pick up on that, senator. the whole point is to stand up

the afghan police so we can get out. now, through still we have afghan police and afghan military not against the taliban but will this increase the pressure on president obama and on republican candidates to get out? >> it probably will, chris. a al after all these years to try to help these people, this the thanks we get? this is a tragedy that is unfolding. it should remind us how feckless some of the leaders are and it. we need to define out our security issues, not to be attacked there. but the illusions of this we were going to be engaged in nation building. that is not going to happen anytime soon. they are not just for that. >> chris: let me ask you about another rap. the president apologizing, at

the same time the first two americans were killed, apologizing for the burning of the qurans. he is trying to prevent more americans from getting killed. on the other hand you saw romney and gingrich hitting him. why are we apologizing to the afghans for burning books while killing american soldiers? >> first of all, i think it was wrong for qurans to be burned and it violates the policy of the u.s. government. at the same time the fact they were accidentally burned. now, we have americans being deliberately killed. there is not a moral equivalent si here. i do worry when the president treats this issue, i guess somehow morallyquiver lent. while making clear it's wrong, should i think the president should be strong we are not going tolerate.

i guess they did yesterday with americans being targeted here. >> i think it was pragmatic move by the president. it becomes political when you have gingrich it's outrage to apologize. you know mirt romney apologizes for america. you want to make sure the president, he is protecting american servicemen and women. the equivalent i don't know we can get into it. he did what was appropriate for an american president. >> chris: we have to take a break here. when we come back, what would a rick santorum win mean to already unsettled race for president? our panel weighs in after the break.

i think senator santorum could take back what he said. he said he voted for some things because he took it to the team. >> if you are going to vote for someone that you trust? >> chris: republican candidates mitt romney and rick santorum getting into words on the final weekend before the michigan primary. we're back with the panel. after another barrage of negative ads and aggressive performance in the debate this week. mitt romney has moved into a small lead in michigan and a bigger lead in arizona. where does the race stand now? is it enough for romney to win michigan or does he to have win by a sizable margin? >> actually a week ago, it would

have been enough. he would have needed to win by a sizable margin but a win would be seen as turning things around. where we are in this primary is where we intended to be by the rnc rules where it's easy for a front-runner to wrap up early. we have sprints in the past. it was designed to make it more of a race. now it may make it a marathon but i think the race is going on for some time. it does come down to romney and santorum. >> the proportional awarding of delegates especially in michigan even if santorum comes close, he still gets a good share of the delegates and claim he did very well. >> chris: but romney could get the popular vote and santorum could get actually the majority of the delegates. >> so for santorum, as you were

dufg with ed, we're going to have a long republican race. republicans see the man looks like the inevitable nominee is not doing all that well in terms of independent voters. he is terrific in running negative ads and a lot of money in the super pacs. he is terrific tearing down, we can begin with rick perry and newt gingrich and now rick santorum but it comes to cost of republican solidarity and cost in terms of general election where you are trying to win independent voters. you look at hispanics and women, his numbers have fallen through the floor. >> chris: let me turn to another aspect. romney this week unveiled this new economic plan, the headline is a 20% cut across the board in marginal tax rates. does that help satisfy conservatives who kept saying that mitt romney is totally on

his biographer and not his ideas? >> i think it helps. you cut tax rates and mine does do. [ laughter ] >> i would say though, it is indicative the problems that romney has. it's not a sense of conservative or moderate, cutting the tax code by top is still the current tax code it's lower. i do think there is much more of a market than governor romney appreciates under risk because they aren't going there. but there is a big political market out there for big change and big ideas and sense that the system is broken. i would think the way in which mitt romney presents his plan doesn't convey the sense of urgency. >> chris: it's interesting, senator, i talked about the

criticism from the right he is using the class warfare argument but kind of playing in to it because he is not going to treat the top 1% the same as he treats the middle-class. he says i am most concerned about the middle-class and i'm not going to lower or eliminate the capital gains tax, dividends tax for people making over $200,000 a year. people on the right are upset on that. he is banking on i am the champion of the middle-class will be affected in running against obama? >> he is looking down the road and he doesn't want to make himself vulnerable that he favoring the top 1% because it will lay on him and the stereotype, rhetoric and comments about him being affluent candidate. he wants to avoid that. i think the ongoing story is a couple of things. first you have a very weak front-runner. this is his home state and he is

barely getting 40%. why is he weak? he is not resonate weight base of the republican party. eventually if he going to win litigate by tactically, but he has to come up with a broader message and be an authentic messenger for that. >> chris: you don't think the 20% tax cut did? >> that wall street editorial page will notice, you can go on michigan and put a gun to their head going to the caucuses and nobody will tell you specifics of romney's economic plan but they get a gut sense a leader with big ideas that will try to lead this in a better direction, god love him, he hasn't been able to communicate that yet. >> chris: let's talk about the others in the race. let's assume that the polls hold up and romney wins michigan and wins narrowly and santorum finishes a strong second. what kind of staying power does

santorum have. are you saying gingrich is really on the sideline now? >> he is on the sideline now. he is not playing in michigan. but i understand the question is his is super tuesday and congressional district in georgia, can he do well in the south. he could get back in the game. one of the things i've learned in this election year, all conventional wisdom is out the window. that could probably be his last stand, clearly his campaign's approach. i do believe it is probably going to be romney and santorum from here through probably april. >> chris: we got less than 30 seconds, juan, is that what you see, this goes into a two-man race? >> i keep damaging my credibility. [ laughter ] >> i thought gingrich was done several times but he has come back and proved me wrong. but g.o.p. intensity from all this, is o with santorum right now. that is where i would look.

>> chris: i'm with you. no prediction. thanks panel. see you next week. check out panel plus where our group picks up with our discussion on our website at foxnews.com. we'll post a video before noon eastern time and follow us on twitter. up next, our power player of the week. p@?ñm ñoy÷h>óñc>ó

>> chris: by now it is almost a cliche a young man or woman who comes up with a business for the internet worth billions but each time it is still something of a shock. here is our power player of the week. >> amazon is where you go when you want things to go up on your door step in two days and facebook. i think there is an answer to that for local and we can be that. >> tim oh shaughnessy is founder and oec of living social that offers big discounts at local businesses. they can save up to 70% at restaurants, spas and stores. the businesses get new customers. >> the yellow pages wasn't cutting it. they couldn't see was that per performing and people coming through the doors. we put those things together and thought there was a strong path ahead. >> chris: what do you think of

groupon? >> they have built a big business. >> groupon is the biggest sue upon website. >> there is a competitive aspect but i think it will end up being when history is written something that looks more like ebay and amazon. >> live social is branching out from coupons offering members adventure. >> we might do something called whitewater rafting and beer tasting. we will take you through a rafting experience and then to a brewery he and drop you back off in the city. >> and they just opened a clubhouse in washington where they offer experiences like a two hour painting class with juan or a cooking class with a top local chef. >> we are not going to peel the carrots. chop them up a little bit. >> he showed us a few of h his 5,000 employees putting

together adventures. >> you will see people e-mailing back and forth, figuring out contracts. there is a sexiness associated with the actual event but a lot of labor that goes into actually get it there. >> there were 700 coupon businesses on the web last year. 170 shut down. in november, groupon raised $700 million in an ipo that put its value at more than $13 billion. >> if groupon is worth $13 billion, what is livingsocial worth? >> without the north tell you what it is, it is a very good question. how much do you want to buy shares from me more? >> as a kid, o' shaughnessy used to buy candy in bulk and resell it at the play ground. >> triple in price? where do you think you got the entrepreneurial bug. >> he would check out performances versus salaries and decide who was a bargain.

>> all of those types of characteristics i think are part of my dna and it has been a lot of fun to be able to turn that into a career. >> building a business he thinks will make life in the big city a little nicer. >> people want to feel connected to their cities. they want to support local businesses. if we can keep doing that and do that right that is going to be a fantastic business. >> chris: in case you are wondering when living social sells a coupon a $20 meal for $10. they take 30% to 50% of that and gives the rest to the local business which hopes that it picks up a new customer. next sunday an exclusive interview with presidential candidate rick santorum just before super tuesday. and that is it for today. have a great week. and we'll see you next "fox captioned by closed captioning services, inc.